Skip to main content

Wall Street Journal reports Ratner had decided to ditch Gehry by November 2008, portrays sale to Prokhorov as a coup

In anticipation of the expected transfer of the New Jersey Nets to Russian billionaire Mikhail Prokhorov, developer Bruce Ratner granted what the Wall Street Journal described as a "rare interview" and was rewarded with an article that, while portraying him as bruised by the experience of ownership, delves neither into questions about Prokhorov nor the propriety of the latter's benefiting from significant public subsidies and eminent domain.

It's the Wall Street Journal, after all, a respected publication, but with the business class in mind. The headline: Bruce Ratner's NBA Waterloo.

The article reminds us that, as was obvious, Ratner became a sports team owner as leverage for a real estate deal. Eric McClure of NoLandGrab reminds us, Wait — we thought it was "100% about basketball."

Ratner thought project was dead?


The WSJ reports:
Mr. Ratner's employees speak of how he was always optimistic about his project, through six years of litigation and a global financial crisis, when, in basketball parlance, he learned to rebound. Mr. Ratner always promised his troops they would figure out a way to keep alive his dream of moving the basketball team into a gleaming arena in Brooklyn. He didn't tell anyone what he really thought—that the project was dead.
Ditching Gehry

The WSJ's Matthew Futterman pinpoints November 2008 as the moment when Ratner ran the numbers and, "[w]ithin hours," decided to ditch Frank Gehry as the arena designer.

Oh. That's not what they told us.

Yes, the New York Daily News and the Wall Street Journal both reported the next month that Gehry had laid off his staff.

New Jersey Nets CEO Brett Yormark, in March 2009, told WFAN:
"Frank Gehry is still the architect of this project. And he loves it. It’s very dear to his heart, no different than it is to all of us – Bruce Ratner, our investors and myself."
The New York Daily News reported in May 2009:
Ratner spokesman Joe DePlasco said a reevaluation of Gehry's design would be completed by July, at which point Ratner will determine whether the world-famous architect would remain on the project.
Revising the deal

The Journal reports:
He also knew he'd have to delay construction of his commercial and residential buildings and negotiate a new deal with the state's Metropolitan Transit Authority. In the previous deal, he'd agreed to pay $100 million for the 22-acre site where the project, known as Atlantic Yards, will be built. But now he would have to replace that lump sum with a series of staggered payments.
(Emphasis added)

Oh, he would, would he? (If only he'd have to pay $100 million for the entire site, rather than for the 8.5-acre railyard. The article has since been updated to eliminate the words 22-acre, but now it sounds like Ratner bought the whole site for 22 acres. Not so.)

The framing here suggests, not without foundation, that Ratner is fully capable of getting public agencies to renegotiate. Whether that's a good thing or not goes by the wayside.

The Prokhorov rescue

Ratner is described as pulling of a coup in getting Prokhorov to invest in the Nets. True, he found one of the few people in the world with the liquidity and the interest in investment.

Then again, didn't Prokhorov get a bargain? And doesn't he deserve a smidgen of scrutiny? The Journal doesn't even approach the Times, which inconclusively looked into Prokhorov's activities in Zimbabwe.

Ratner comes out ahead?

The Journal reports:
Mr. Ratner predicts that when the arena opens in three years, the value of his stake in the team and the surrounding real estate will exceed what he paid for the Nets and also what he sustained in losses during the six-year battle for the project.
Well, maybe. A new arena--expect to open in 2.5 years--would significantly raise the value of the team. Whether it would raise the value of real estate destined for housing is another question. The key issue is the provision of tax-exempt bonds for construction.

After all, as his cousin Chuck Ratner once said, "we still need more" subsidies.

A correction

The article describes the project's location as "downtown Brooklyn"--not so--but appropriately points out it's across the street from Ratner's malls (which actually opened in 1996, not "a decade ago").

Arena 2012 or 2013?

The article leaves some wiggle room for arena delays, noting that the team would go "to Brooklyn in two or three seasons."

Comments

Popular posts from this blog

Barclays Center/Levy Restaurants hit with suit charging discrimination on disability, race; supervisors said to use vicious slurs, pursue retaliation

The Daily News has an article today, Barclays Center hit with $5M suit claiming discrimination against disabled, while the New York Post headlined its article Barclays Center sued over taunting disabled employees.

While that's part of the lawsuit, more prominent are claims of racial discrimination and retaliation, with black employees claiming repeated abuse by white supervisors, preferential treatment toward Hispanic colleagues, and retaliation in response to complaints.

Two individual supervisors, for example, are charged with  referring to black employees as “black motherfucker,” “dumb black bitch,” “black monkey,” “piece of shit” and “nigger.”

Two have referred to an employee blind in one eye as “cyclops,” and “the one-eyed guy,” and an employee with a nose disorder as “the nose guy.”

There's been no official response yet though arena spokesman Barry Baum told the Daily News they, but take “allegations of this kind very seriously” and have "a zero tolerance policy for…

Behind the "empty railyards": 40 years of ATURA, Baruch's plan, and the city's diffidence

To supporters of Forest City Ratner's Atlantic Yards project, it's a long-awaited plan for long-overlooked land. "The Atlantic Yards area has been available for any developer in America for over 100 years,” declared Borough President Marty Markowitz at a 5/26/05 City Council hearing.

Charles Gargano, chairman of the Empire State Development Corporation, mused on 11/15/05 to WNYC's Brian Lehrer, “Isn’t it interesting that these railyards have sat for decades and decades and decades, and no one has done a thing about them.” Forest City Ratner spokesman Joe DePlasco, in a 12/19/04 New York Times article ("In a War of Words, One Has the Power to Wound") described the railyards as "an empty scar dividing the community."

But why exactly has the Metropolitan Transportation Authority’s Vanderbilt Yard never been developed? Do public officials have some responsibility?

At a hearing yesterday of the Brooklyn Borough Board Atlantic Yards Committee, Kate Suisma…

Barclays Center event June 11 to protest plans to expand Israeli draft; questions about logistics

At right is a photo of a poster spotted in Hasidic Williamsburg right. Clearly there's an event scheduled at the Barclays Center aimed at the Haredi Jewish community (strict Orthodox Jews who reject secular culture), but the lack of English text makes it cryptic.

The website Matzav.com explains, Protest Against Israeli Draft of Bnei Yeshiva Rescheduled for Barclays Center:
A large asifa to protest the drafting of bnei yeshiva in Eretz Yisroel into the Israeli army that had been set to take place this month will instead be held on Sunday, 17 Sivan/June 11, at the Barclays Center in Downtown Brooklyn, NY. So attendees at a big gathering will protest an apparent change of policy that will make it much more difficult for traditional Orthodox Jewish students--both Hasidic (who follow a rebbe) and non-Hasidic (who don't)--to get deferments from the draft. Comments on the Yeshiva World website explain some of the debate.

The logistical questions

What's unclear is how large the ev…

Atlanta's Atlantic Yards moves ahead

First mentioned in April, the Atlantic Yards project in Atlanta is moving ahead--and has the potential to nudge Atlantic Yards in Brooklyn further down in Google searches.

According to a 5/30/17 press release, Hines and Invesco Real Estate Announce T3 West Midtown and Atlantic Yards:
Hines, the international real estate firm, and Invesco Real Estate, a global real estate investment manager, today announced a joint venture on behalf of one of Invesco Real Estate’s institutional clients to develop two progressive office projects in Atlanta totalling 700,000 square feet. T3 West Midtown will be a 200,000-square-foot heavy timber office development and Atlantic Yards will consist of 500,000 square feet of progressive office space in two buildings. Both projects are located on sites within Atlantic Station in the flourishing Midtown submarket.
Hines will work with Hartshorne Plunkard Architecture (HPA) as the design architect for both T3 West Midtown and Atlantic Yards. DLR Group will be t…

Forest City acknowledges unspecified delays in Pacific Park, cites $300 million "impairment" in project value; what about affordable housing pledge?

Updated Monday Nov. 7 am: Note follow-up coverage of stock price drop and investor conference call and pending questions.

Pacific Park Brooklyn is seriously delayed, Forest City Realty Trust said yesterday in a news release, which further acknowledged that the project has caused a $300 million impairment, or write-down of the asset, as the expected revenues no longer exceed the carrying cost.

The Cleveland-based developer, parent of Brooklyn-based Forest City Ratner, which is a 30% investor in Pacific Park along with 70% partner/overseer Greenland USA, blamed the "significant impairment" on an oversupply of market-rate apartments, the uncertain fate of the 421-a tax break, and a continued increase in construction costs.

While the delay essentially confirms the obvious, given that two major buildings have not launched despite plans to do so, it raises significant questions about the future of the project, including:
if market-rate construction is delayed, will the affordable h…

Revising official figures, new report reveals Nets averaged just 11,622 home fans last season, Islanders drew 11,200 (and have option to leave in 2018)

The Brooklyn Nets drew an average of only 11,622 fans per home game in their most recent (and lousy) season, more than 23% below the announced official attendance figure, and little more than 65% of the Barclays Center's capacity.

The New York Islanders also drew some 19.4% below announced attendance, or 11,200 fans per home game.

The surprising numbers were disclosed in a consultant's report attached to the Preliminary Official Statement for the refinancing of some $462 million in tax-exempt bonds for the Barclays Center (plus another $20 million in taxable bonds). The refinancing should lower costs to Mikhail Prokhorov, owner of the arena operating company, by and average of $3.4 million a year through 2044 in paying off arena construction.

According to official figures, the Brooklyn Nets attendance averaged 17,187 in the debut season, 2012-13, 17,251 in 2013-14, 17,037 in 2014-15, and 15,125 in the most recent season, 2015-16. For hoops, the arena holds 17,732.

But official…

So, Forest City has some property subject to the future Gowanus rezoning

Writing yesterday, MAP: Who Owns All the Property Along the Gowanus Canal, DNAinfo's Leslie Albrecht lays out the positioning of various real estate players along the Gowanus Canal, a Superfund site:
As the city considers whether to rezone Gowanus and, perhaps, morph the gritty low-rise industrial area into a hot new neighborhood of residential towers (albeit at a fraction of the height of Manhattan's supertall buildings), DNAinfo reviewed property records along the canal to find out who stands to benefit most from the changes.
Investors have poured at least $440 million into buying land on the polluted waterway and more than a third of the properties have changed hands in the past decade, according to an examination of records for the nearly 130 properties along the 1.8-mile canal. While the single largest landowner is developer Property Markets Group, other landowners include Kushner Companies, Alloy Development, Two Trees, and Forest City New York.

Forest City's plans unc…